In the wake of the continuous disruption caused by the COVID-19 pandemic and as a result of various requests received from the businessmen and assesses under the Income-Tax Act 1961. The Central Board of Direct Taxes (CBDT) on September 30 prolonged the last date for filing belated and revised ITRs for Assessment Year 2019-20 from September 30, 2020, to November 30, 2020.

Similarly, in further consideration to the genuine difficulties created by the pandemic due to the Covid-19 situation, the CBDT  has announced the extension of the due date for furnishing due date of belated & revised ITRs for Assessment for the years 2019-20 from 30th September 2020 to 30th November 2020 in accordance with the issued Order u/s 119(2a).

Deadline Clock Due Limited Time Hands Ticking 3d Illustration

1. Who is under the obligation to file an income tax return under the Act?

An individual below 60 years of age, who possesses a total income of Rs. 2.5 lakhs or more in a financial year is liable to file an income tax return. Similarly, after the age of 60 years, an individual assessee  (aged 60 years or more) and for a very senior citizen (aged 80 years or more) this income limit gets increased to Rs. 3,00,000 and Rs. 5,00,000 respectively for the purposes of tax payments and filing a return of income.

However, legal entities like Companies and partnership firms are mandatorily required to submit their ITR returns even in cases where they suffered a business loss in the previous year.

2. What do you mean by an original return?

An assessee liable to pay tax as per the prescribed income brackets and rates under the Income –Tax Act is required to file returns within prescribed time-limits under section 139 of the Income-Tax Act 1961. Therefore, A valid return filed within the due dates specified in the above table is called an original return.

If the assessee is an Indian resident, he is under an obligation to submit his ITR, if his total income even if there is no tax liability. Additionally, in some conditions as provided under the  Seventh Proviso to Section 139(1), it is mandatory to file the return even if the total income does not cross the basic exemption limit.

3. What is a Revised Return?

A Revised Return is required to be filed by an assessee, where on submission of original ITR, he becomes conscious of some missing information or any corrections completely or any other reason which he intends to alter or modify in the original return, is known as a revised return. The due date for the submission of the return is before the end of the relevant assessment year.

For instance where Mohan is an individual assessee who has filed his original return of income on 10th July 2019. However, on 20th July 2019, he realized that he forgot to disclose his bank account details correctly. In such a situation, he has the option to file a revised return under 139(5) of the concerned Act. On doing so, such revised return will override his original return.

4. What is a Belated Return?

As the name suggests, belated tax returns are when you fail to submit your original return within time and file your tax returns after the extended returns filing deadline under Section 139(4) of the IT Act. Thus, an assessee who does not file his return within the timelines prescribed in the income tax act but files it after the due date is referred to as a belated return. As per the 2016 Finance Act amendment, belated tax returns can be filed within a year before the relevant Assessment Year, or when the AY ends.

For example, Ram is an individual assessee with a taxable income of Rs. 7, 00,000 from salary in AY 2019-20. He files his return on 5th September 2019 where the due date to file the return was 31st August 2019. Thus, Ram will be able to file his belated return any time until 31st March 2020.

5. What are the Consequences if there is a delay in Filing Your Return?

For an income-taxpayer, filling and submissions of ITR should be a constant and timely ritual because failing to file one may take away many benefits as well as may lead to the payment of additional penalties under the Act.

Following are the consequences of delay in filing the return of income by a taxpayer:

1. Assesses who have suffered losses under the head and under “Business &Profession” will not get the option to carry forward their losses.

2. Assesses may also be subjected to pay a penal interest rate dependent upon the amount of tax due to up to 1% per month under section 234A of the Act.

3. Such a taxpayer may also be subjected to levy a penalty under section 271F for late filing of the return to an amount up to Rs.10, 000. Though, the amount will not exceed 1000/- in cases where the taxable income is below 5, 00,000.

4.Where an assessee is eligible to receive a for a refund, the tax department will levy interest under Section 244A, a portion of which will be lost due to the late filing of return.

Conclusion-

Thus, the extension of dates to file original/revised, as well as belated returns through, will have the benefit make submissions in the extended timelines and file the annual returns by 30 November. This extension will give necessary advantage to taxpayers including legal entities as well as individual taxpayers in the country who are already struggling to bring their life towards normalcy in the middle of the increasing COVID rates in India.

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